Illinois Cannabis Legalization Update

Illinois Cannabis Legalization Update

Illinois is one of the fastest moving cannabis legalization states in the country. So a lawyer from Peoria Illinois offers this video and blog post rundown. This post is going to cover its big three. Adult use, hemp & medical marijuana.

Illinois Cannabis Update – Medical Marijuana

Since it passage in 2015, Illinois has steadily grown its medical marijuana program. There are only 58,000 medical card holders in the state, but that number may soon explode because of…

Industrial Hemp in Illinois

Illinois’ Industrial Hemp Act goes into effect for the 2019 crop year. While the early adopters may reap some of the benefits, over the years hemp could become a common sight along corn and soybeans in the farmland of the state.

The regulations include the following rules:

No person may grow hemp without a license

No person may handle hemp without a license

All seeds, clones and transplants must be certified under AOSCA.

minimum space of one-quarter acre for outdoor and 500 sq.ft. for indoor growing

A completed application must be submitted to the state BEFORE growing

Recently, the state of Illinois also released its application requirements for hemp – they are as follows:

The name and address of the applicant

The type of business or organization, such as corporation, LLC,partnership, sole proprietor, etc.;

Business name and address, if different than the ones submitted inresponse to subsection (a)(1);

The legal description of the land area, including Global PositioningSystem coordinates, to be used to cultivate industrial hemp;

A map of the land area on which the applicant plans to grow industrialhemp, showing the boundaries and dimensions of the growing area inacres or square feet;

Documentation to prove the land area is a farm as defined in Section 1-60of the Property Tax Code; and

HR 420 - Regulate Cannabis Like Alcohol

H$ 420 - Regulate Cannabis Like Alcohol bill

Answer: Regulate Cannabis Like Alcohol by:

Move Cannabis out of Controlled Substances Act

Expand the ATF to include Cannabis

Fix numerous federal crimes related to cannabis

House Resolution – 420

On January 9, 2019, Oregon Congressman, Earl Blumenauer, introduced the Regulate Marijuana Like Alcohol Act. If passed, it will end federal marijuana prohibition and move cannabis to the Bureau of Alcohol Firearms Tobacco & Explosives (ATFE).

Cannabis Industry Lawyer:

Rep. Blumenauer Speaks about HR 420

“The Cannabis Caucus was the first of its kind to create a forum for elected officials to collaborate on ways to address our outdated federal marijuana laws” said Rep. Blumenauer. “Congress is clearly out of step with the American people on cannabis when national support for federal marijuana legalization is at an all-time high and we saw several states move toward legalization last November.”

The Cannabis Caucus is not just liberals from the West Coast, like Oregon’s Blumenauer, but also members of Congress from accross the isle, like Reps. Dave Joyce (R-OH) and Dong Young (R-AK).

How Likely Is HR 420 to Become Law?

Probably not very likely – already 5 cannabis bills have been introduced to Congress. So it is a coming wave for sure, but with the current government shut down, and a presidential election only a few more years away. Cannabis advocates may have to take a back seat to silly things like Russia, the Wall, and whatever other farce grips headlines under President Trump’s remaining 2 years.

Thomas Howard

Cannabis Lawyer

Thomas Howard has been in business for years and can help yours navigate towards more profitable waters.

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Cannabis stock video bulletpoints

Cannabis Lawyer Video Summary

1. Illinois cannabis lawyer & former stockbroker Tom Howard explains that the cannabis companies are using the Toronto Stock Exchange (TSE) to route around the Controlled Substances Act (CSA) and list their marijuana stocks on US exchanges like the Nasdaq – for example Tilray (Daq: TLRY)

3. The CSA makes it difficult – if not impossible – for American cannabis companies to list on the stock market due to the slew of federal crimes that arise from marijuana’s schedule I classification.

4. Canada has legal cannabis since October 17, 2018, thus companies like Aurora Cannabis to dual list its stock on both the TSE and then also list on the Nasdaq.

5. The Trump administration has taken no action to stop the trading of Canadian cannabis stocks like Tilary, or Aurora, but with the ouster of Jeff Sessions – we can only speculate if the Department of Justice or Securities and Exchange Commission will take steps to curtail the cannabis stock trade.

6. The TSE has still not allowed the listing of cannabis companies that control United States assets because it violates the CSA under US law, but numerous operators in the cannabis space are segmenting their companies to allow for dual listing.

7. The dual listing of cannabis stocks allow the companies operating in both the United States and Canada to be in the market BEFORE the United States drops Cannabis from the CSA if a bill like the one Chuck Schumer introduced in the Senate passes. So watch out.

8. If you have questions for a Cannabis Lawyer, contact our office today for help resolving it with our complex commercial cannabis attorneys.

Additional Cannabis Stock Market Links

Here is a detailed Forbes article that explains how American companies use their Canadian exposure to list their stock in both countries to prepare for legalization:

In this context, marijuana-related companies are really reaching the mainstream, with two big ETFs, the Horizons Marijuana Life Sciences Index ETF (OTC: HMLSF) (TSE:HMMJ) and the ETFMG Alternative Harvest ETF(NYSE:MJ) trading on major stock exchanges, and businesses like weed grower Cronos Group Inc.(NASDAQ:CRON) and cannabinoid-based biotech GW Pharmaceuticals PLC- ADR(NASDAQ:GWPH) listing on the Nasdaq, and Canopy Growthtrading on the NYSE.

Exceprt from the very detailed Bezinga article regarding steps to participate in the marijuana stock trade – as a warning from a former broker – OTC stocks are not liquid and have trading difficulties with entry and exit – you’ve been warned but for more…read it all here:

Is CBD Oil Legal in all 50 states?

Cannabis Industry Lawyer answers your questions about the legality of CBD Oil. Have a cannabis law question? Ask it now and maybe your question will be answered in the next episode of the Cannabis Industry Lawyer.

Thomas Howard

Litigation Attorney

A Rising Star and Emerging Lawyer, which only 2% of all attorneys receive. Practicing in contract litigation with a growing cannabis business advisory practice.

Questions?

Cannabis Legalization Summary

Here’s the Cannabis Legalization News roundup for August 2018:

Congress is asleep & at their districts due to the Election in November, so do not hold your breath. Probably nothing will happen on Cannabis until next Congress, but you know what that means – it will continue to grow and expand without anyone standing in the way.

Here are the links to the content for the August issue of the Cannabis Legalization round up.

Cash is king – especially in the legal cannabis industry that has problems accessing banking.

The Controlled Substances Act (CSA) expressly prohibits possession and commerce in marijuana. 21 U.S.C. §§ 841(a)(1), 846. All marijuana is prohibited, no exceptions. However, a different law that authorizes federal funds to the Department of Justice contains an exception to the prohibition of marijuana pursuant to the CSA.

No deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances (within the meaning of schedule I and II of the Controlled Substances Act) which is prohibited by Federal law or the law of any State in which such trade or business is conducted.

“IRC 280E has the cannabis industry paying more taxes than any other legitimate business in the United States.”

IRC 280E creates havoc for medical marijuana businesses

Photograph by Lorem Ipsum via Unsplash

Here’s the takeaway from the video above regarding using credit cards to buy cannabis.

In 1980 a coke dealer got busted, but his attorney said that he should be able to deduct the cost of his illegal cocaine sales business. As a result, Congress passed IRC280E and forbid deducting costs of “carrying on” a business of selling schedule 1 substances, which are prohibited by state or federal law.

Businesses typically deduct two main costs – those of goods sold, and those of ‘carrying on’ the business. The costs for carrying on a business are those related to operations in sales. For example, your rent, phone bill, utilities, employees, marketing, little baggies for the above-described coke dealer, everything except the costs of the goods sold (COGS).

Fun Fact: Congress did not include COGS in the law banning the ‘carrying on’ deductions for fear of a constitutional challenge.

The marijuana industry makes this distinction quite easy. Costs of goods sold are those incurred in growing and preparing the crop for market, while those of carrying on the business are those related to its sale. As a result, cultivation centers have to worry about the double tax less than dispensaries. The costs a cultivation center incurs go to the cost of producing the cannabis, while the costs incurred by the dispensary are all related to its sale.

In the video, Tom explains how the precise wording of three pieces of federal law – and a bedrock principle of tax law – all come together to avoid the double taxation issue to state-law approved medical marijuana businesses. Check out the video – and subscribe to the Cannabis Industry Lawyer’s YouTube channel to ask your question about a legal issue in the legal marijuana industry.

Cash is king – So the Congress introduced one of the many pro cannabis laws – the SAFE Act.

Secure & Fair Enforcement Act

This was one of the first YouTubes that I did back in February of 2018.

Fortunately, I’m versed in the subject matter. I’ve been hard at work creating additional content – this website included – so that i can continue on our shared mission of brining the cannabis laws in line with the factual reality of the substance.

“Until Schedule 1 cannabis is a thing of the past, there is little choice but to deal in cash”

my book on cannabis laws

Photograph by Lorem Ipsum via Unsplash

The SAFE Act did something that just dropping cannabis from the Controlled Substances Act (“CSA”) would do – namely, give legitimate cannabis businesses access to financial services. We’re dedicated to turning the most legitimate cash-only business in America into just another American business.

Congress has taken action to defund Jeff Sessions and his “bad people smoke pot” henchmen at the Department of Justice, but not taken action to remove Cannabis from the CSA. Yet, since 2013 Congress has put forth legislation like the SAFE Banking Act, which only begs the question – or raises the question: Why introduce a bill destined to die?

Congress should not claim victory for introducing a bill it knows doom to fail because the Banking Committee is run by the worst sounding named man in the Senate and anti-cannabis Republican, Mike Crapo. Idaho – another peculiarly named thing – thought it fit to put a Crapo in Office, who is blocking sensible cannabis legislation that gives Banks the ability to grease the wheels of the cannabis industry into tens of billions of dollars, or more.

The good Senator from Oregon should stop wasting our, and Crapo’s, time, and just introduce a bill to drop cannabis from the CSA. It also may fail, but at least over 60% of Americans want Congress to pass the law legalizing cannabis. Then, at least, we have a singular wedge that can be pushed by all of us in the movement and defeat the 80-year-old lie that is marijuana prohibition.

Cash is king – especially in the legal cannabis industry that has problems accessing banking.

This was one of the first youtubes that I did back in February of 2018. It almost pains me to watch it because I am doing a lot of things wrong and really have no clue about the format.

Fortunately, I’m versed in the subject matter. I’ve been hard at work creating additional content – this website included – so that i can continue on our shared mission of brining the cannabis laws in line with the factual reality of the substance.

“Until Schedule 1 cannabis is a thing of the past, there is little choice but to deal in cash”

Image of man on moon – happened before legal cannabis.

Photograph by Lorem Ipsum via Unsplash

Here’s the takeaway from the video above regarding using credit cards to buy cannabis.

What it is:

A Point of Banking System (PBS) creates a cash-free ATM

The PBS uses your debit card, or credit card if you can remember your PIN, to do a cash transaction.

It feels like you’re buying legal cannabis with credit cards.

What it is not:

Using credit cards to buy your state-law compliant cannabis.

Credit cards do not have a merchant code for cannabis

Credit card companies push back on this because it is technically money laundering on their system of credit and they are fearful they will be shut down.

I think that the defunding of federal prosecution of the nation’s marijuana laws has implications on the legality of the transactions, but that may be misplaced due to the standards and practices of statutory drafting – which is such a dry topic that it will not be addressed here.

Currently, billions of dollars are being spent on cannabis transaction that are perfectly legal in the state in which they occur, while being somewhat banned in the country. Still, Jeff Sessions and the Department of Justice have not taken any actions to stop Colorado, California, or any state.

If you have any topics related to operating a marijuana business, please click over to the youtube and leave it in the comments – and don’t forget to subscribe. Until next week, keep it legal because you deserve the best!